The Long View: Wars, Inflation, Recession, and Domestic Sleeper Cells

The Long View: Wars, Inflation, Recession, and Domestic Sleeper Cells
Electrical towers in San Francisco on Aug. 30, 2007. (Justin Sullivan/Getty Images)
Chadwick Hagan

War often leads to inflation, and although inflation isn't directly responsible for recession, price increases and decreased economic activity often lead to a recession.

When I wrote about the resilience of the U.S. dollar weeks back, I had no idea we would step into another conflict. Granted, the Israel conflict is a conflict that I support and understand, but it doesn't take much to figure out that bombing a territory while simultaneously sending billions of dollars in aid to the territory being bombed—Gaza—makes for an interesting narrative.

The United States has spent more than $75 billion on the Russia–Ukraine war, and that amount doesn't count the money given to allies to support the effort.

Between Jan. 24, 2022, and July 31, 2023, the United States sent $26.4 billion in financial support, while $46.6 billion has gone to military expenses.

Now President Joe Biden has asked Congress for $105 billion for Ukraine, Israel, and the border.

For $180 billion, where does this leave us?

Let’s take a look at a few statements from varied sources, such as the Chatham House, the European Central Bank (ECB), and investing legend Bill Gross.

Dame DeAnne Julius from Chatham House said: “The pandemic shut down large parts of the service sectors of economies and disrupted supply chains into manufacturing. In addition, many governments provided fiscal support through furloughs for people laid off work and grants to keep businesses afloat while they were unable to produce or sell. The result was a rise in savings and a sudden bounce-back in demand when COVID restrictions were lifted.”

On the Russia–Ukraine war, the ECB stated: “The war triggered a massive shock to the global economy, especially to energy and food markets, squeezing supply and pushing up prices to unprecedented levels. Compared with other economic regions, the euro-area has been particularly vulnerable to the economic consequences of Russia’s invasion of Ukraine.”

On Oct. 23, bond guru Bill Gross said: “Regional bank carnage and recent rise in auto delinquencies to long-term historical highs indicate U.S. economy slowing significantly. Recession in fourth quarter.”

At the moment, the United States is finally staring down a recession, and it's been coming for a while. However, we are also staring down the potential of another war, one that's rarely mentioned in the press. In March, Sen. Angus King (I-Maine) asked energy security experts “if they believe there are cyber 'sleeper cells' that have infiltrated the nation’s energy grid and may be positioned for a future attack.”

Elsewhere, former FBI Special Agent Eric Caron said, "We have over a thousand joint terrorism task force cases going on here in America today relating to Muslim extremists."

Ask yourself this: While fighting numerous wars, battling inflation, and contending with the looming threat of a recession, what happens if domestic attacks start from sleeper cells hiding out across the United States? What if the sleeper cells decide to attack our energy grid? What if these sleeper cells decide to start a religious war in the United States? It's completely possible, and no one can say our border is safe.

No one can say that out of the millions of illegal immigrants who have come through our southern border in the past few years, we don’t have any enemies in the mix.

How many potential enemies are hiding in the United States, waiting for the next opportunity?

And what about China? What happens if China decides to wage war to regain control of Taiwan?

All of a sudden, a world war seems plausible. How will the United States respond, and what will this do to our economy?

What will this do to our country?

Chad is a financier, author, and columnist. He has managed businesses and investments in global markets for over two decades. His recent book, "Global Family Office Investing,” was published by Palgrave McMillan in 2021, and Chad’s macroeconomic blog,, was archived by the Library of Congress in 2019.
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